This is an important lesson that nearly every eBay Powerseller has learned at one point buying products for resale.
There are cases where you purchase a bulk load of products to sell on ebay, which is similiar to having a hit record on radio. The products will sell at your Ebay auction listings almost as fast as you can put them up for sale, and at price you want.
But there are also times when products do not sell quickly, and at a lower price than anticipated.
Lesson 1 Evaluate all factors before buying large quantities of product to sell on eBay.
Lesson 2 You need to forecast time needed to sell entire load of product, this will help you determine correct price to bid on liquidation.
Here is an example of an eBay Powerseller not taking into account all of costs that may be involved, before buying a large load of product.
Powerseller “A” bid and won a pallet of what was perceived to be a great value, a load of name brand cosmetics. The load contained over 7000 individual items such as lipstick, nail polish, hand creams etc. The average cost per piece was 75 cents, so entire load was purchased for $3750. The Powerseller thought they did their homework, individual items were selling for a minimum of $2.50 each on eBay.
There are several problems that occurred after purchase. The eBay Powerseller was so focused on potential profit, nearly $2 per item, which then added up to $14,000 profit. (If all were sold). They did not accurately forecast time needed to sell all cosmetics.
The reality is there was not a high sell rate with these items, they averaged selling 10-20 of these items per month on eBay. It would take 29 years to sell all brand name cosmetics inventory at that rate.